Total number of employed persons in Malaysia grew in 2022

Overall, 15.39mn people were in employment last year, a figure that was 2.2% higher (or 327,600 persons more) than in 2021.

Malaysia saw its labour force strengthen by 1.4% (equivalent to 224,900 persons) in 2022 to record 16.02mn persons, up from 15.8mn the year before.

At the same time, the country's labour force participation rate (LFPR) remained on an increasing trend, rising 0.7 percentage points (pp) to reach 69.3% (2021: 68.6%), the Department of Statistics' Labour Force Survey Report 2022 revealed.

Excerpts of the report's key findings – LFPR statistics, unemployment & employment data by demographics/location, and more, are shared below:

LFPR

In 2022, an upward trend was recorded in both the male and female labour force. Specifically, the male labour force rose by 1.6% to comprise 9.78mn persons, compared to 9.63mn recorded in 2021. Similarly, the female labour force saw an increase from 6.17mn persons in 2021, to 6.24mn in 2022.

Looking at age groups, the group comprising 25 to 34 year-olds posted the highest LFPR in the year, with 86/1%; while the lowest was recorded among those aged 15 to 24 years (46.1%). Meanwhile, the group of 35 to 44 year-olds also registered an increase of 0.6pp to record 84.3%, followed by those aged 45 to 54 (75.7%).

Finally, by gender among age groups, the highest LFPR in the male labour force was seen in the age group comprising 35 to 44 year-olds (98.3%); while for females, it remained in the group comprising 25 to 34 year-olds, which rose 4pp to record 76.8%.

By state, the data is as follows:

• Selangor: 76.9%
• Putrajaya: 75.7%
• Kuala Lumpur: 72.4%
• Johor, Sabah: 70.9% each
• Pulau Pinang: 70.3%
• Melaka: 69.3%
• Sarawak: 67.9%
• Labuan: 67%
• Perak: 65.2%
• Pahang: 64.8%
• Perlis: 64.2%
• Negeri Sembilan: 64%
• Kedah: 63.8%
• Terengganu: 58.8%
• Kelantan: 58%

Employment

Coming to employment – a total of 15.39mn people were in employment last year, a figure that was 2.2% higher (or 327,600 persons more) than in 2021, which saw 15.06.mn persons in employment.

Subsequently, the employment-to-population ratio, which indicates the ability of an economy to create employment, increased 1.1pp year-on-year to reach 66.5% (2021: 65.4%).

By sector, the report revealed the following make-ups of employed persons in selected areas:

• Services: 65%
•  Manufacturing: 16.8%
• Agriculture: 10%
• Construction: 7.6%
• Mining & quarrying: 0.5%

Next, by status of employment, the employee’s category accounted for the majority of employed persons in the year (78.3%), with a year-on-year increase of 1.9%, adding to 12.05mn persons (2021: 11.82mn).

Data for the remaining categories surveyed is as follows:

• Own-account workers: 1.5% (2.33mn; 2021: 2.23mn)
• Employers: 3.5% (532,900; 2021; 508,400)
• Unpaid family workers: 3.2% (487,000; 2021: 503,300)

Third, In terms of skill level, semi-skilled workers represent the majority of employed persons in 2022 (58.4%), followed by skilled workers (29.6%) and low-skilled workers (12.0%). Year-on-year, the number of semi-skilled workers in employment increased by 3.4% to record 8.99mn persons.

At the same time, the number of employed persons in the skilled categories grew by 2.4%, registering 4.56mn persons. For low skilled categories, however, this dropped by 3.7% to record 1.84mn persons in 2022. 

In addition to the employment data above, DOSM also shared details on underemployment in the country – related to time, as well as to skills, and employed persons working less than 30 hours a week.

Employed persons working less than 30 hours a week

As shared in the report, this refers to employed persons who worked less than 30 hours during the reference week of the survey, either due to the nature of their work or to insufficient work. In 2022, phase four of Malaysia's National Recovery Plan was implemented in every state, which led to the improvement in economic performance, DOSM added. Thus, the number of employed persons working less than 30 hours a week went on a downward trend, falling by 18.1% year-on-year (-75,600 persons) to record 341,800 persons (2021: 417.4 thousand persons). This gorup comprises 2.2% of the total employed persons, down 0.6pp from the preceding year (2021: 2.8%).

Subsequently, the rate of time-related underemployment in 2022 decreased by 0.3pp, standing at 1.6% (2021: 1.9%). 

In terms of skill-related underemployment, the report noted that this indicator measures persons with tertiary education and working in the category of semi-skilled and low-skilled jobs. It portrays the matter of overeducation job mismatch, which refers to a situation where a person had to accept a job that requires skills lower than his educational achievement. 

In that vein, there were more occurrences of skill-related underemployment in 2022, up 4.6% from the year before. This, in specific, refers to an additional 88,000 persons in skill-related underemployment, reaching a total of 2.02mn in the year (2021: 1.93mn). However, in terms of rate, it registered a decrease to 38% as compared to 38.7% in 2021.

Unemployment

On the unemployment front, 2022 saw a drop in the percentage of people who were unemployed (3.9%), 0.7pp lower than the year before. This, DOSM attributed to the improvement of the economy as it gradually recovers from the pandemic. In line with that, the number of unemployed dropped by 102,700 persons in 2022, to record 630,400 (2021: 733,000).

Delving deeper, among the unemployed, the actively unemployed – i.e., those who are prepared to work and are actively looking for a job – made up 79.8% of the total unemployed persons in the year. This was a 9.3% drop (-51.7%) from the year before, it was added (503,000; 2021: 554,700).

Additionally, within this group of actively unemployed, those who have been unemployed for less than three months accounted for 47.4%, while those who were in long-term unemployment for more than a year made up 8.3% (41,500). 

Last but not least, the data on unemployment rate was broken down by state:

• Sabah: 7.5%
• Labuan: 7.2%
• Perak: 4.6%
• Perlis: 3.9%
• Negeri Sembilan, Sarawak, Kelantan: 3.7% each
• Selangor, Terengganu: 3.6% each
• Johor: 3.3%
• Kuala Lumpur: 3.1%
• Kedah: 3%
• Pulau Pinang: 2.8%
• Pahang: 2.5%
• Melaka: 1.6%
• Putrajaya: 1%

Lead image & infographics: DOSM